09 November 2008

This is old news by now, but I hadn't been able to talk about it yet. Argentina's government has seized private pension funds. In the economic realm Argentina is a "bad actor." The supposed rationale for the seizure was relayed by Mary Anastasia O'Grady, who also provides a needed reality check:

Mrs. Kirchner defended her decision to seize the pension assets by asserting that the market is too risky for retirement savings, and that the returns earned by private-sector fund managers are not adequate.That's quite a claim considering that the average annual return of Argentina's private-sector pension managers over the past 14 years is 13.9%. But it is even more absurd if one compares the private-sector returns to those of the government's pay-as-you-go social security system over four decades.

I hope we take this action as a warning and zealously guard our property rights, lest we one day find ourselves in this predicament.